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Higher shipments, prices help AK Steel post surprise profit
July 29, 2014 / 12:46 PM / 3 years ago

Higher shipments, prices help AK Steel post surprise profit

(Reuters) - AK Steel Holding Corp (AKS.N) reported a surprise quarterly profit as prices rose and it shipped more steel, sending its shares up nearly 8 percent to their highest in two years.

The West Chester, Ohio-based company’s shipments rose nearly 6 percent to 1.4 million tons in the second quarter ended June 30, while average selling price rose 3.2 percent on higher spot market prices for carbon steel products.

Steel prices in North America are near two-year highs and global crude steel production rose 3.1 percent in June as producers cranked up output in response to an improving economic outlook.

The company expects a steep decline in raw material prices to lower third-quarter output costs and boost margins, Chief Executive Jim Wainscott said on a conference call with analysts.

Wainscott said he expected the company to perform much better in the second half of the year.

AK Steel makes flat-rolled carbon, stainless and electrical steels, and tubular products for car makers, industrial and construction companies and utilities.

The company’s shares were up 3 percent at $9.06 in late morning trading on the New York Stock Exchange. They touched a high of $9.44.

AK Steel posted a profit of 2 cents per share, excluding items, compared with the average analyst estimate of a loss of 4 cents per share, according to Thomson Reuters I/B/E/S.

Net loss attributable to the company narrowed to $17.1 million, or 13 cents per share, from $40.4 million, or 30 cents per share, a year earlier.

Net sales rose 9 percent to $1.53 billion.

Reporting by Anannya Pramanick in Bangalore; Editing by Savio D'Souza and Maju Samuel

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